EU accuses Google of ‘abusing’ its dominance online

in Brussels

The European Commission formally accused Google of abusing its dominance in the internet shopping space.

It also initiated a separate investigation into its Android operating system yesterday, and warned the US internet giant that further investigations could be in the offing.

Announcing the European Commission's decision in Brussels, EU competition commissioner Margrethe Vestager said that the Commission's investigation so far suggests that Google has "artificially boosted its presence" in the comparison shopping market in a way that may disadvantage consumers and competitors.

“Our preliminary view is that in its general internet search result, Google artificially favours its own comparison shopping service and that this constitutes an abuse.”

Market share

Pointing out that Google has a market share of more than 90 per cent in general internet searches in most EU countries, Ms Vestager said that the Commission would “continue to look at Google’s conduct in other areas”, which includes the search engine’s approach to mapping, hotels, flights and business services.

“We are still actively looking into the other related markets,” she said, adding that the current case “could potentially establish a broader precedent for how to enforce EU competition rules in other instances.”

Google, which has its European headquarters in Dublin, has come under increased scrutiny from the EU regulatory and legal system in recent years amid concerns about market dominance and data protection rights.

In the so-called “right to be forgotten” case last year, the European Court of Justice ruled that Google must delete “inadequate, irrelevant or no longer relevant” data from search results if requested from a member of the public.

Separately the EU’s competition arm has been investigating Google since 2010.

Although the internet company previously proposed a number of "remedy" packages to Ms Vestager's predecessor Joaquin Almunia, including a commitment to give competing products and services increased visibility on websites, these failed to convince the Commission.

Yesterday, Ms Vestager stressed that the Commission did not favour a "quick-fix", but wanted a "future-proof" solution based on principle, amid fears that the Google case could continue for years as was the case with the European Commission's competition investigation into Microsoft.

The Commission has the power to fine firms up to 10 per cent of revenue, ultimately leaving Google facing a potential €6 billion fine.

Competition

Google rejected the European Commission’s allegations, pointing out that there was “a ton of competition”, including

Amazon

and Ebay. “Google’s shopping results have not the harmed the competition,” the US multinational said.

Google has ten weeks to respond to the “statement of objections” formally sent by the European Commission.

A number of interest groups and political parties in the European Parliament welcomed the European Commission's announcement.

"There can be little doubt that Google abuses its dominant market position, so it was high time for the Commission to formally act on this," the competition spokesman for the Green Group, Michel Reimon, said. "The Commission should now push ahead and ensure there are proper consequences for Google's business model."

Speaking in Brussels, Ms Vestager rejected any suggestion that the European Commission’s action towards Google had any link to the fact that the company is a US firm.